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Thirteen new SBA lenders started making loans in the fiscal year that just ended Sept. 30. Lending activity has been building in recent months, spurred by a federal stimulus plan that gave banks more incentives, such as waived fees, to invest in small businesses.

"Of course, most people understand when you have the kind of significant economic downturn that we've experienced, you don't turn it around in a matter of a few months," Rackear said. "It's a long-term process."

Indeed, any recent uptick in small-business lending couldn't mask the fact that this SBA district — which includes the bulk of the Tampa Bay market — has just closed the books on a very ugly year.

Though a dozen new lenders arrived on the scene, about 100 lenders actively doling out loans in 2008 didn't make a single loan last fiscal year. The total volume of bank SBA loans throughout the district plummeted 43 percent to $466.8 million.

One sign of the times: A bank run by Lehman Bros. ranked among the top lenders in the region in 2008 with $22 million in loans. Those were all made before its collapse a year ago. Hence: zero loans in fiscal 2009.

The credit crunch, one of the hallmarks of this recession, wreaked havoc in particular on startup companies and entrepreneurs seeking the most common SBA loans, known as 7(a)s.

Only 917 applications for 7(a) loans passed muster in the fiscal year, down 62 percent from a year ago. The total amount doled out, $242.4 million, was less than half the volume of 2008.

It wasn't much better for companies vying for larger 504 loans, which are used for major capital improvements and land purchases. A total of 308 companies (down 22 percent) received $224.4 million worth of 504 loans (down 30 percent).

Bank of America, long the top SBA lender, was a shadow of its former self, making only 31 startup loans in the district totaling $3 million last fiscal year, down a whopping 86 percent from more than $22 million a year ago. The megabank made $21 million worth of 504 loans as well, down 43 percent.

"I'm not going to dispute the number," Bank of America spokesman Don Vecchiarello said. He cited three main reasons for the decline: tighter underwriting standards, healthy small businesses wary of taking on more debt in a declining economy, and a less desirable pool of candidates.

"There's a deterioration in the applications we're getting," he said. "That's led us to return to more sustainable underwriting standards."

The fallout from lending to companies hit hard by the recession has become increasingly apparent on Bank of America's balance sheet. In its latest earnings report, the bank's net charge-off rate for soured small-business loans had risen to 17.45 percent.

"Bank of America is committed to lending responsibly," Vecchiarello said. "Going forward, we want to support small-business owners by making every good loan we can and pro­actively help those struggling with loan payments."

Florida Chief Financial Officer Alex Sink, a former state president for Bank of America, said she was concerned that large banks are still reluctant to make small-business loans in Florida.

"I've been having meetings with small-business owners from around the state and when I ask what their main concern is … time and time again what I've been hearing is a lack of access to credit," Sink said. "The banks seem to have frozen them out."

In support of a new initiative by the Obama administration to increase small-business lending, Sink said she plans to call executives and out-of-state and community banks this week to urge them to lend more.

Reviving small-business lending is particularly crucial in a state like Florida, Sink said.

"We're not a big Fortune 500 state. We're a state of small businesses. … We have 2 million small businesses in Florida employing less than 20 people each."

Giving out more advice than money

SBA officials say there are signs the credit crunch has been easing.

Nationally, the SBA has supported more than 33,000 loans for a total of almost $13 billion in small-business lending since the American Recovery and Reinvestment Act — a.k.a. the federal stimulus plan — was approved in February. That represents a 50 percent increase in loan volume from the February low.

Rackear said Florida lending has likewise picked up gradually in recent months thanks to the stimulus plan.

Under the Recovery Act, the SBA is reducing fees and picking up 90 percent guarantees on 7(a) and 504 loans, a program expected to run out before the end of the year. It's also promoting a new program called America's Recovery Capital, or ARC, which is enticing business owners with hopes of receiving government-backed, no-fee, no-interest loans of up to $35,000 apiece.

Last week, President Barack Obama trumpeted yet another proposal to make it even more attractive for banks to make SBA loans and spur small-business lending in general.

"There are banks making loans," said Brenda Dohring Hicks of the Dohring Group, which just refinanced the loan for its headquarters in downtown Tampa.

Not all business owners in the bay area agree with her. Particularly those trying to secure one of the new ARC loans, which banks have been very slow to embrace.

Ed Fink has been on what seems like an endless odyssey throughout west Pasco County to get an ARC loan for his struggling 13-year-old lawn and landscape business.

No dice with Bank of America, which had jacked up his business credit line interest rate more than 10 percent. SunTrust turned him down because he didn't have an existing account. So did BB&T, even though his business had a current equipment loan with them. Last week, he was awaiting a formal denial letter from JPMorgan Chase.

Fink has lost two large commercial contracts, cutting his revenue in half. But he thinks he's still a viable candidate for a loan. He said he just needs some help getting through a rough patch.

"We've had impeccable payment and credit history … but now we're having trouble making payroll," Fink said. "We qualify for the loan, but I don't think the banks want to lend the money."

Rackear's advice to cash-starved businesses is to try building relationships. They also might try searching in unlikely areas, based on a review of the latest SBA data.

While lenders such as Bank of America were shrinking, some were making huge strides. They included little-known players such First Peoples Bank, KeyBank and Live Oak — and some large regional banks like SunTrust, which doubled its volume of 7(a) loans from 2008. Ocean Bank made a half-dozen fewer loans than a year ago, but nearly doubled the total amount lent to $17 million.

Supplanting Bank of America as the top regional lender for the year was PNC Bank out of Pittsburgh, which made $30 million in 7(a) loans and $5.4 million in 504 loans.

Angel Rodriguez, PNC senior vice president and Florida business banking market manager, said PNC has been aggressively seeking new business and added more business banking officers in the state.

But he downplayed the significance of a single year's data. SBA lending, he said, is just a small piece of a customer relationship. The goal is to understand how a given company is managing its cash flow, then use that information to help it grow.

Making SBA loans had turned into "a transactional opportunity" in the years when the economy was percolating, Rodriguez said.

"Now we're getting back to the roots of (advising) businesses on what helps make them successful," he said.

Rodriguez and Bank of America's Vecchiarello said that their bankers are trying to help small businesses with less-than-stellar credit weather the storm. Bank of America, for instance, said it has modified interest payment schedules for 49,000 small-business credit card customers in the first nine months of 2009.

The question is how long small businesses can survive.

Last month American Express released a Small Business Monitor survey indicating more firms say they are at risk of going out of business (17 percent) than six months ago (11 percent). About a third (32 percent) said they were using personal or private funds to manage cash flow, up from 23 percent six months ago.

Ed Fink, the owner of the Pasco County lawn service company, is among those running out of patience and trying to avoid layoffs.

"We're looking for some kind of financing whether we get the ARC loan or not," he said. "It's crunch right now. We're hanging in there as best we can."

President Barack Obama last week proposed a new plan to increase lending to small businesses still struggling through the credit crunch. He wants to increase caps for existing Small Business Administration loans and provide smaller banks with better access to the government's Troubled Assets Relief Program. The proposal, which would require support from both Congress and banks, calls for:

• Increasing the size of SBA's popular 7(a) loans for startups and emerging businesses from $2 million to $5 million.

• Increasing the size of SBA's 504 loan (often used for larger capital purchases or land acquisition) from $2 million to $5 million for standard borrowers and from $4 million to $5.5 million for manufacturing.

• Increasing the size of SBA's microloan from $35,000 to $50,000.

Drop in SBA loans

Small Business Administration loans made in these counties in 2009 vs. 2008: